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ASOS "looking at" keeping Topshop flagship store on Oxford Street

Lauretta Roberts
01 February 2021

ASOS CEO Nick Beighton has said the online fashion giant could keep Topshop’s flagship Oxford Circus store open after buying the Topshop, Topman and Miss Selfridge brands from the collapsed Arcadia retail empire.

Beighton said the online giant was “looking at” the possibility of keeping hold of the store. However he added that the move was “not a priority” and that ASOS was “not a store business”. He said ASOS was weighing up the benefits of continuing to operate from the central London location in some capacity.

This morning ASOS confirmed a £265m deal to buy the flagship brands, along with a £30m deal to buy some stock, but said it would not be taking on any of its stores.

Following the collapse of Arcadia in December, KPMG was separately hired as administrator for the 214 Oxford Street building, which also houses Nike and Vans stores.

Administrators said that before the lockdown, which has closed all non-essential retail stores, the 100,000 sq ft site welcomed 400,000 customers through its doors each week.

Beighton said ASOS would discuss the possibility of taking on the lease of the Topshop store in the building with a third-party partnership, but has no intention of buying it outright.

The store, which boasted a DJ booth, nail bar and food stalls, was a retail sensation after it opened in 1994.

Retail analyst Richard Hyman said he thought it would be a “smart move” for ASOS to keep the Oxford Street store. “I personally think they should definitely hold on to it,” he said.

These have to be long-term decisions and at some point this year the shops will reopen and Oxford Street is the biggest shopping street in western Europe.

“I’d position the Topshop store among Selfridges and the two Primark stores as one of the main shops on Oxford Street. I’d put it above John Lewis, M&S and others.”

Last year, senior lender Apollo Global Management provided Arcadia with a £310m four-year loan, secured against the site.

It is understood the Arcadia pension fund would benefit from anything generated from the sale beyond the £310m loan.

Following the announcement of the purchase of the brands, ASOS said it would look to have some retail presence with them via key strategic retail partners in the UK and elsewhere, and would be leveraging a relationship with department store Nordstrom in the US to further the brand's awareness in that market.

The three brands were the jewels in the crown of Sir Philip Green's collapsed empire and generated £1bn in annual sales before the COVID crisis hit. ASOS has been selling the brands online via its own website since 2019 and has been experiencing strong demand for them.

Despite not taking on any of its stores, ASOS is seen as the most natural fit for the brands of all of the bidders, given that it already understands its core customer base, which sits in its sweet spot of fashion forward 20-somethings. Since ASOS arrived on the scene in 2000, it has pitched itself as the main online rival to Topshop.

Arcadia's remaining brands also look set to disappear from the high street with ASOS's smaller rival Boohoo in exclusive talks acquire Burton, Dorothy Perkins and Wallis. Boohoo had been an early favourite to acquire Topshop when it came on the market but industry watchers say the brand was too important to ASOS – which unlike Boohoo does not have a history of growth by acquisition – to allow it to fall into the hands of a rival.

ASOS also beat off competition from Next in partnership with Davidson Kempner, Authentic Brands in partnership with JD Sports and Chinese giant Shein to acquire the brands.

Additional reporting; PA Media

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